Digital Pay-Meter Playbook - How Today's News Publishers Can Use Data, Best Practices, and Test-and-Learn Tactics To Build Better Pay-Meters ...
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Digital Pay-Meter Playbook How Today’s News Publishers Can Use Data, Best Practices, and Test-and-Learn Tactics To Build Better Pay-Meters A Shorenstein Center and Lenfest Institute White Paper August 2019 Authors Nicco Mele, Lecturer, Harvard Kennedy School Matthew Skibinski, Reader Revenue Specialist, the Lenfest Institute for Journalism Matthew Spector, Visiting Researcher, Shorenstein Center on Media, Politics and Public Policy, Harvard Kennedy School The views expressed in Shorenstein Center Discussion Papers are those of the author(s) and do not necessarily reflect those of Harvard Kennedy School or of Harvard University. Discussion Papers have not undergone formal review and approval. Such papers are included in this series to elicit feedback and to encourage debate on important issues and challenges in media, politics and public policy. Copyright belongs to the author(s). Papers may be downloaded for personal use only.
Abstract
The past half-decade has seen a digital subscription renaissance in the news
publishing industry. Publishers are increasingly recognizing a market de-
mand for high-quality, meaningful, trustworthy content, and in turn seek to
cultivate premium, high-value brands that engage readers.
Our research suggests publishers should invest in capabilities to engage
in constant testing and experimentation in digital — to build engagement
among digital audiences and ultimately convert engaged readers into
paying subscribers. For commercial and for-profit models in particular,
publishers should become smart across a range of new strategies, including
how to configure meters and rules to calibrate a mix of free and paid access.
The trends we have observed across the publishers studied suggest pricing
models, marketing tactics, and new approaches to audience engagement
can help publishers succeed in a news environment increasingly friendly to
robust digital programs.
Produced through surveys of more than 500 for-profit newsrooms, this re-
search suggests new best practices to aid publishers in increasing and sus-
taining digital subscriptions. This initiative complements existing research
at the Shorenstein Center on Media, Politics and Public policy uncovering
sustainable business models for local news and nonprofit publishers.
This paper begins with recommendations for publishers to propel shifts to
subscriber-focused models, how to define their news organization’s market,
and how to measure engagement within that market. They are followed by
a set of suggested strategies to drive a reader’s intent to subscribe, and to
maintain that digital subscribership once that reader has entered a publish-
er’s ecosystem.
Digital Pay-Meter Playbook / August 2019
The Shorenstein Center on Media, Politics and Public Policy / 2
Table of Contents
Summary 2
Introduction: The Reader Revenue Imperative 5
Defining a Market 7
The Market and Digital Audience 7
Digital Audience Frequency 9
Benchmarking Stop Rates 10
Increasing A Publisher’s Stop Rate 12
Meter Best Practices 12
Driving Subscriptions 15
Conversion Rates 15
Subscriber Engagement and Retention 21
Best Practices for Subscriber Engagement 22
Conclusion 29
Appendices 32
A Shared Vocabulary for Digital Subscription Best Practice 33
Digital Pay-Meter Playbook / August 2019
The Shorenstein Center on Media, Politics and Public Policy / 3Summary
Our research suggests a shift from advertising-based models to digital
subscriptions enables news organizations to deliver more reader-relevant
content, validate operational models that offer more stable business per-
formance, and free up resources to plan for longer-term investments in
content and news quality.
What you need to know from the report:
1. It’s time to get more sophisticated. It is the “end of the begin-
ning” of the digital subscription era. Across the publications studied,
It is the “end of news publishers, especially newspapers, have adopted basic digital
the beginning” subscription models this decade. This moment shows standards of
of the digital performance and best practice are coalescing around structures for
subscription era. newsrooms and the operational teams that support them, suggesting
a longer-term prospect for stabilization of the news marketplace.
2. Industry benchmarks are critical to more sophisticated tactics
(see the Shorenstein Center’s email benchmark tool). Among the
organizations surveyed, digital publishers are well on their way to
evolving a standard for success in subscriptions – shared metrics,
many of which are reviewed in this paper, are vital to understand
these standards. Measures of market penetration, audience engage-
ment, meter or paywall stops, conversion rates, and retention rates
can be used to paint a more comprehensive picture of the health of a
publication’s digital subscription business, and can help to determine
key areas of focus for a particular publisher’s organization.
3. Intelligent access rules enable publishers to fine-tune and im-
prove their standing. There are no “hard and fast” rules for paywalls.
Instead, “intelligent access” evaluates data continuously to create dif-
ferent access control rules for different behaviors. Among publishers
studied, targeted intelligent access control rules allow a news organi-
zation to optimize its stop rate, or increase the percentage of all users
Digital Pay-Meter Playbook / August 2019
who are stopped monthly by a payment ask. There is no “one-size-
fits-all” solution.
4. You must have a sharp focus on your consumers if you hope to
increase conversion rates. Once users encounter a payment mes-
sage, publishers can serve targeted marketing messages based on the
user’s history on the site, and offer simplified purchase processes to
increase conversion. Across the news organizations studied, we found
that subscribers who also receive a publisher’s email news product
The Shorenstein Center on Media, Politics and Public Policy / 4are 5-10 times more likely to subscribe. Those who follow the pub-
lisher’s brand on social media are 4-6 times more likely to subscribe.
News organizations
that performed 5. Pricing variation, churn analysis, and engagement testing are
ahead of their key tools for publishers to keep subscribers engaged. Our research
peers tended to reinforced that by experimenting with price, understanding sources
deliver distinctive, of churn, and targeting subscribers to improve their engagement,
high-quality jour- publishers can improve their retention rate.
nalism – suggest-
ing innovation in 6. Engagement matters, and publishers must continue to innovate
quality journalism to earn attention. Our research found a relatively strong association
itself...should be a between subscriber engagement and retention. This suggests that,
long-term area of relative to a publisher’s geography, an engaged reader is a valuable
focus reader. Across the publishers studied, news organizations that per-
formed ahead of their peers tended to deliver distinctive, high-quality
journalism – suggesting innovation in quality journalism itself, rather
than merely producing a high volume of content, should be a long-
term area of focus for publishers.
Methodology and Limitations
The benchmarks and recommendations in this document are based on data
from more than 500 news organizations with digital subscription or mem-
bership models between 2011 and 2018. As a survey of a range of large and
small news organizations, the recommendations use aggregated data to
suggest where publishers perform across their digital subscription busi-
nesses. These benchmarks are meant as broad recommendations for pub-
lishers to contextualize and estimate performance and subscriber growth
associated with a particular strategy or set of related tactics, relative to
their peers.
A substantial portion of the data was collected directly from the Press+
Digital Pay-Meter Playbook / August 2019
digital subscription system, a technology platform used by several hundred
news organizations between 2011 and 2016 before the company merged
with Piano Media. Publishers using Press+ opted into sharing data about
their digital subscription performance on the condition that be shared
only in an aggregated, anonymized format. This data was extracted directly
from the back-end subscription system, rather than via publisher surveys,
and only covers the time period up to 2015.
Data added to the data set since that time has been collected using pub-
lisher surveys in a number of contexts, such as individual consulting
The Shorenstein Center on Media, Politics and Public Policy / 5engagements, industry collaborations such as the Facebook Local News
Subscription Accelerator, and the Knight-Lenfest Table Stakes program.
In all cases, data was provided on the condition that it be shared only in an
anonymized and aggregated manner. The surveys captured simpler, base
metrics such as total subscribers or total unique visitors to remain consis-
tent with the style of data extracted from the back-end subscription system.
The authors then applied those raw data to formulas to generate more ad-
vanced metrics, such as conversion rates or retention rates, where possible.
An example of that extraction matrix is available here.
This benchmark data was derived from a variety of organizations, in-
cluding national and leading metro publications, local publications, and
digital-only brands. The vast majority of data – more than two thirds of
publishers in the data set – comes from local, regional and metro-area
newspapers in the United States. Some metrics, such as market penetration
rate, were compiled from publicly-available data. Certain private data were
provided on the condition that metrics and benchmarks are anonymized.
Not every publication that provided data did so for every KPI or bench-
mark.
Digital Pay-Meter Playbook / August 2019
The Shorenstein Center on Media, Politics and Public Policy / 6Introduction: The Reader Revenue Imperative
Communities – and the news publishers that serve them – increasingly
need for new business models that can sustainably support the produc-
tion of quality journalism. The University of North Carolina’s School of
Media and Journalism reports that more than 1,300 communities in the
It did not seem United States have lost local news coverage entirely since 2004.1 As tra-
possible that ditional news outlets continue to reduce staff and streamline operations,
classified ads that figure may increase as both for-profit and nonprofit newsrooms face
were more pressure from readers, investors, and stakeholders to stabilize, grow, and,
important to ideally, innovate new ways of bringing news to the communities that need
the reader than them.
serious news
articles. Across our research, many for-profit news organizations faced the chal-
lenge we call the revenue trap of the digital advertising business model.
Digital advertising models require large volumes of pageviews, which can
incentivize sensationalism, virality, or “copycat” editorial efforts rather
than encourage quality, independent journalism. Across the publishers
analyzed, we found volume-driven digital advertising engenders a race-to-
the-bottom to produce the lowest-cost, highest-volume content.234 Publish-
ers reliant on digital advertising generally see business goals as increasing-
ly distant from editorial priorities.
Conversely, digital subscriptions require growing the number of users who
are highly engaged in a publisher’s content. Across the news organizations
surveyed, when users pay for access to news content, the business goals
of a news organization more closely meet editorial goals. This shift in the
key underlying unit of growth – from page views to engaged readership –
incentivizes publishers to invest in content that is valuable to readers. We
found this holds at for-profit news organizations, where reader revenue
models align business goals with editorial goals, as well as nonprofit news-
rooms, where membership models ask readers to support journalism they
find most valuable.
Our findings suggest digital news consumers will indeed pay for access to
Digital Pay-Meter Playbook / August 2019
high-quality content, particularly when they are presented with compel-
ling, relevant information and marketing messages that inspire deep and
ongoing engagement. Publishers succeeding in growing digital subscrip-
tions are outperforming the median by a factor of 10.5
The alignment of editorial intent and business performance comes with a
better understanding of growing and sustaining engaged subscribership.
Comparing performance across markets and operations to distil key in-
sights, the compiled benchmarks offer suggestions for publishers to under-
The Shorenstein Center on Media, Politics and Public Policy / 7stand where they fall relative to a cross-section of news organizations. The
99th percentile among publishers in the datasets studied suggests most
effective strategies – and are supported by recommendations for how they
might deploy these strategies in their organizations.
Defining a Market
Under digital subscription model, a news organization’s audience can be
understood through the publisher’s funnel – with the broader addressable
market represented atop the funnel; engaged users represented as the fun-
nel narrows; and paying, loyal subscribers at the narrow bottom.
The publishers studied had largely coalesced around this model, moving
readers from discovery and engagement, to subscribing and sustaining
subscribership – while ultimately aiming to broaden the funnel to increase
their share of engaged subscribers. The below benchmarks correspond to
these stages of the audience funnel.
Digital Pay-Meter Playbook / August 2019
The Shorenstein Center on Media, Politics and Public Policy / 8The Market and Digital Audience
Key Finding: A well-defined market target leads to larger and more en-
gaged digital audiences, among the publishers studied.
Publishers that performed above their peers across the news organizations
and market dynamics studied tended to base their digital strategies on a
well-defined market, and scoped their editorial objectives to best serve
that market. Anecdotally, some publishers studied that have successfully
deployed digital subscription strategies have derived a clear market defini-
tions from their legacy print audiences.
In digital subscriptions, the publishers studied measured their market by
the digital audiences within that geography and region, and unique visitors
relative to that – the market penetration. While a news organization’s over-
all market penetration is not the most reliable indicator of a publisher’s
success, it provides a useful signal of a publisher’s strength in its geogra-
phy.
The publishers studied on this metric that demonstrated the greatest
market penetration – Minneapolis Star Tribune Network and Boston Globe
Media sites – perform more effectively relative to their peers.
A review of market penetration that examined various news organizations’
unique visitors as a percentage of total digital desktop audience in their
market showed the Star-Tribune with a market penetration rate of 31%,
nearly double the median. The Boston Globe performed second-best of the
organizations studied, with a 23% market penetration rate. According to
figures from Pew Research Center, publishers should seek to match or
approach the 18-21% year-over-year increase in unique visitors indus-
try-wide.6
These high performers suggest that if a publisher establishes itself as a
Digital Pay-Meter Playbook / August 2019
unique and essential source of news in its market, beyond what might be
a legacy print presence, it can likely generate significant digital demand.
Both of these organizations were early adopters of paywalls and meters –
these tests meant the publishers could begin to prioritize reader and sub-
scriber engagement over advertising revenue, leading to more reader-fo-
cused editorial strategies.789 This approach begat a virtuous cycle of quality
coverage within their respective markets that generates further subscrip-
tions and continued engagement among existing subscribers.
The Shorenstein Center on Media, Politics and Public Policy / 9Digital Audience Frequency
Key Finding: Growing digital audiences into “regular readers” requires a
defined audience engagement strategy.
The publishers studied generally shared definitions for their digital audi-
ences – and the most effective strategies to reach and engage them. Across
data provided by 15 metro area publishers, we saw the following propor-
tions of digital audiences10:
● Sixty eight percent (68%) of readers view only one article in a thir-
ty-day period.
● Twenty-three percent (23%) of readers view between two and five
articles in a thirty-day period.
● Only nine percent (9%) of users were “regular readers,” who view
more than five articles in a thirty-day period.
Publishers with high engagement see a higher volume of these regular
readers. News organizations with larger-than-average “regular readership”
– engaging that critical nine percent of audiences – tended to prioritize
audience engagement efforts, including social media content promotion,
in-situ recommendation engines, dedicated newsletters, and dedicated
audience development teams. Our research found the most successful pub-
lishers test and deepen one or two of these audience engagement verticals
to test which strategies most effectively drive one-time and occasional
readers to increase their readership.
Benchmarking Stop Rates
Key finding: Most publishers are too generous and need to stop more
readers to force conversion.
Across publishers studied who had metered or “freemium” subscription
models, their operations focused on building a critical metric: the stop
rate, the percentage of all digital users who are “stopped” by a subscrip-
Digital Pay-Meter Playbook / August 2019
tion prompt, a paywall, or a meter limit. The stop rate is calculated by the
number of users stopped by a meter or paywall in a given month over the
number unique visitors during that period.
A majority of the publishers studied across this metric are stopping a lim-
ited proportion of readers relative to their overall audiences. Among the
more than 500 news organizations analyzed, the fiftieth percentile of pub-
lishers stops only 1.8 percent of their readership with a paywall or meter.
Publishers with “sustainable” digital businesses report stop rates between
The Shorenstein Center on Media, Politics and Public Policy / 10the 80th and 90th percentiles of all publishers studied (at or above 4.2% of
all readers). The publishers that reported more than 6% of unique visitors
reaching their stop threshold had “thriving” digital subscription business-
es – robust teams, and well-developed audience engagement strategies.
A majority of
the publishers
studied lagged
behind thriving
news organi-
zations in their
stop rate.
Among our most significant findings is that a majority of the publishers
studied lagged behind thriving news organizations in their stop rate. Defi-
nitionally, a publisher with a low stop rate is only asking a small and likely
insufficient percentage of their readership to subscribe. Even if the news
organization is successful in converting their addressable audiences and
unique visitors, publishers that are underperforming likely have limited
opportunity to grow subscribers if they are failing to stop a significant
Digital Pay-Meter Playbook / August 2019
enough portion of their overall readership.
A news organization’s stop rate often distinguishes high-performing pub-
lishers. The large metropolitan daily newspapers studied report stop rates
approximately double the industry as a whole, with a median stop rate of
3.64 percent. These publishers often invest heavily in audience develop-
ment, effective newsletters and social media marketing to circulate their
content to build engagement. Publishers like the youth-focused Mic report
a high return on investment around the developing customized and niche
strategies by channel within their engagement activities unit. News or-
The Shorenstein Center on Media, Politics and Public Policy / 11ganizations with smaller engagement teams might first focus on one key
channel – newsletters – and optimize through testing multiple approaches
to messaging.11
Publishers can understand why their stop rate is high or low by isolating
(High-performing) stop rates by platform and channel; testing meter rules including the du-
publishers often ration and number of pieces of content included in the meter; and bench-
invest heavily in marking their audience engagement within their market, or against other
audience devel- similar publishers in other geographies or with similar-sized digital audi-
opment, effective ences or sophistication. Technical challenges can also be a source of chal-
newsletters and so- lenge: the majority of meter stops are driven by desktop. Mobile stop rates
cial media market- lag those of desktop due in part to the technical challenges of implement-
ing to circulate their ing mobile metered paywalls; news organizations that have not optimized
content to build these channels might be missing opportunities to bolster their stop rate.
engagement.
Increasing A Publisher’s Stop Rate
Key finding: There are two primary ways for publishers to increase their
stop rate: (1) increase engagement or (2) tighten access rules.12
In assessing access rules, publishers can test various metering rules or the
duration of their meter (e.g. expanding a user’s meter refresh window from
30 days to 45) to identify the levers to improve their stop rate to match
those of the highest-performing publications identified above.
Based on work with publishing groups representing more than 500 publi-
cations with digital subscription models, the following recommendations
can help guide efforts to improve a news organization’s stop rate:
Digital Pay-Meter Playbook / August 2019
The Shorenstein Center on Media, Politics and Public Policy / 12Meter Best Practices
A majority of publishers with metered models set their meter limits at 5
articles per month or lower. The graphic below represents this distribu-
tion, and the general shift in the data from January 2012 to present.
As meters were first introduced, several publishers studied were concerned
meter limits might fail to attract subscribers or would constrain adver-
tising revenue; many of these publishers set high meter limits or allowed
users to circumvent the paywall. For example, when McClatchy began im-
plementing metered models, it set its meter limits at 25 articles per month
and excluded clicks from social media and email newsletters. After seeing
a dip in successful conversions, McClatchy increased the types of clicks
that counted toward a user’s limit.13 As publishers have experimented, and
readers have become accustomed to digital subscription, meter limits have
tended to decline among the publishers studied and within the industry at
Digital Pay-Meter Playbook / August 2019
large.14
Clearly Defining What Counts within a Meter – Access rules play an im-
portant role in improving publishers’ stop rates. These rules include what
content is included in a news organization’s meter, and what referrals or
referral sources count toward the meter rate. According to publisher inter-
views, our research found best practice for access rules overall – regardless
of the strategies used – is to clarify these rules in a manner your audience
engagement team and the average reader can understand.
The Shorenstein Center on Media, Politics and Public Policy / 13Excluding Content from a Meter – Successful publishers studied had clear
rules for what content was excluded and why; clearer guidelines allowed for
more tests of meter strategies and approaches. Higher-performing publish-
ers studied tended to include nearly all article or content elements within
their meter, offering limited exception. Instead of constraining meter rules
to attract a particular audience, including more content types within a me-
ter generally increased the likelihood that a variety of readers and digital
users would ultimately reach a meter limit and encounter a subscription
message.
Common Exceptions to a Meter – Meter exceptions still can prove import-
ant for revenue-related aspects of a publisher’s business. Our cross-analy-
sis of publisher meters found that common exceptions to a meter included
paid content such as obituaries, automobile sales, classifieds, and spon-
sored content as well as sections of content around which the publisher
Typically, if a has seen extremely high return on investment on advertising. Typically, if a
content element content element is solely used for advertising or branded content purposes,
is solely used it will be excluded from the meter. Developing a meter exception strategy
for advertising means understanding the advertising and subscription value derived from
or branded con- all content types; typically, publishers can weigh advertising yield against
tent purposes, it their average revenue per subscriber to evaluate whether to exclude a par-
will be excluded ticular section from a meter.
from the meter.
Content-Specific Metering – In customizing meter rules to reach partic-
ular audiences, publishers studied frequently target messaging or refine
metering experiences based on category of content – e.g. when reaching
their meter limit, a sports reader stopped on local sports coverage might
be served a customized message tailored to that team’s coverage. General-
ly, our surveys found driving toward a particular reader’s interests within
a certain category of content allowed publishers to more efficiently drive
toward the subscription action.
Digital Pay-Meter Playbook / August 2019
Increasing Opportunities To Encounter The Meter– In addition to the
inclusion or exclusion of particular content from their meter rate, publica-
tions studied leveraged geographic targeting, content targeting (lowering
the meter rate for more editorially-intensive content), or behavioral tar-
geting (incorporating factors about a user, including newsletter subscrip-
tion, to increase their meter limit). Others might use propensity targeting
(leveraging a propensity to subscribe score, a strategy observed in more
sophisticated news organizations including the Wall Street Journal), or an
ad block intercept (including a subscription message customized to invite
The Shorenstein Center on Media, Politics and Public Policy / 14the reader to the subscribe or turn your ad blocker off to continue to read
content before the average meter stop).
Driving Subscriptions
Conversion Rates
Key finding: Friction in the purchase experience (delays in page load
times, unclear instructions, extra data fields, or confusing presentations
of an offer) have a dramatic effect on conversion.
Following the meter stop, the highest-performing publishers studied tend-
ed to focus their strategies around their paid stop conversion rate (PSCR),
or total users who subscribe in a given month over total users stopped by a
meter, wall, or gateway. Across the news organizations in our survey, stop
limits and conversion rates tended to be strong predictors of subscrip-
tion growth. The stop rate multiplied by the PSCR and by the publisher’s
unique visitors generates the number of new subscriptions sold in any giv-
en month. Conversion emerged as a critical differentiator for sustainable
publisher businesses; while the top decile of publishers studied generally
converted an average of 1.3 percent of stopped unique visitors per month,
the median 50 percent of publishers only converted 0.5 percent of unique
visitors.15
Factors Impacting Conversion Rates
Meters and conversion rates tended to provide learning opportunities for
publishers across the news organizations surveyed. A publication’s conver-
sion rate is generally a function of three top-level factors:
1. Audience Engagement: the propensity of their audience to subscribe
(readers’ level of engagement and their perception of value in the
product)
Digital Pay-Meter Playbook / August 2019
2. Targeted Offers: the effectiveness of a publisher’s marketing messag-
es and offers, and;
3. Frictionless Purchase: the ease of actually completing a subscription
purchase once a reader has decided to do so.
While each publisher’s audience differs, profiling likely subscribers ap-
peared to help publishers hone and test strategies unique to their markets.
Publishers that tested various propensity models reported that factors
such as reading content in multiple section categories, following a brand
The Shorenstein Center on Media, Politics and Public Policy / 15on social media, or subscribing to a publication’s newsletter were common
factors and determinants of a particular reader’s propensity to subscribe.
One publisher who had engaged in extensive propensity modeling, for
example, reported that newsletter subscribers or those who have provided
emails were 5-10 times more likely to subscribe.16
Don’t skimp on smart marketing: Publishers with high conversion rates
engage in sustained, proactive marketing efforts targeting their most en-
gaged users with discounts, offers, and clear explanations of the benefits of
subscription. (Best practices for doing so are discussed in a later section.)
Frictionless purchase: The lower-performing publishers studied often
paid little attention to the last step in converting a subscriber: the act of
registering for an account and making a purchase. Small changes in the
purchase experience for a user – such as slight delays in page load times,
unclear instructions, extra data fields, or confusing presentations of an
offer – can lead a user to abandon their purchase.
Data from 10 major metropolitan newspapers showed that, on average,
publishers saw an average 90 percent drop-off of users once they enter the
subscription process along the purchase and conversion funnel.17 On aver-
age, only 29 percent of desktop users who saw the first step of the purchase
funnel (presentation of offers and pricing choices) made it to the second
step (providing their email address). Only 14.8 percent reached the step of
the process at which they were asked to enter payment information, and
9.9 percent reached the confirmation page indicating that they had com-
pleted their purchase.
Across the publishers studied, the differences in success rate were critical:
more than 90 percent of users dropped out between the first step of the
purchase process and the last. This drop-off was even higher on mobile
Digital Pay-Meter Playbook / August 2019
devices; the desktop conversion rate was 5 times higher than the rate for
mobile.
The Shorenstein Center on Media, Politics and Public Policy / 16For high-performing publishers studied, optimization across each step of
the subscription process was critical to success. Alongside this optimiza-
tion, platform-led efforts, including Facebook Instant Articles, Facebook
Analytics, Subscribe with Google, and Apple’s iOS subscription program,
are helping publishers uncover opportunities to abridge these subscription
steps.18
Conversion Rates and Meter Levels
Key Finding: High-performing publishers tended to deploy two strate-
gies – more rigorous meters (either a lower article limit or a shorter renew-
al period) and those with more open meters (a higher article limit).
Across publishers studied, for more rigorous meters, we identified a sig-
nificantly higher average conversion rate as publishers reached a higher
meter limit, peaking at a limit of 10 articles per 30-day period. Publishers
with a 5-article limit generate more subscriptions due to a higher vol-
ume of stopped users. In short, in evaluating participating publishers, we
We identified a identified a “tighter” meter limit would lead to a higher stop rate and more
“tighter” meter subscribers from a publisher’s existing audience. Some publishers studied
limit would lead were seeing effective subscription strategies at lower meter limits due to
to a higher stop marketing and pricing strategies.
rate and more
subscribers For more “open” meters, publishers were focused on generating audience
from a pub- growth (resulting in higher advertising revenue) rather than converting
lisher’s existing existing audiences. Across each approach, publishers must balance gener-
audience. ating audience growth with opportunities to convert those audiences into
subscribers.
Given this variety in outcomes, there are no “right” meter limits to convert
a reader, and publishers can expect a wide range of performance at any me-
ter limit. Publishers must be careful in testing these approaches; common
errors include reducing a stop rate below a certain point where the news
Digital Pay-Meter Playbook / August 2019
organization puts traffic at risk – and publishers that see this reduction
typically need to increase the size of the publication’s overall market.
The Shorenstein Center on Media, Politics and Public Policy / 17While conversion rates tend to drop over time, they do have peaks that cor-
respond with promotional activity. Typically the PSCR of 1-2 percent is the
leading average, while publishers below this range have poorly-performing
marketing and/or promotional activity.
Pricing
Key finding: Size (of market, of email list) doesn’t matter; quality does.
Digital Pay-Meter Playbook / August 2019
While the average price of digital-only monthly subscriptions began
around $6.66 in 2011, subscription prices have tended to increase steadily
during the past half-decade.19 The average price for a digital-only month-
ly subscription is now slightly higher than $10 per month, while average
large metro dailies studied charge closer to $12.50 a month for digital-only
subscriptions.20
The Shorenstein Center on Media, Politics and Public Policy / 18Digital Subscription Pricing, Daily Newspapers - 2018 Benchmarks
Conversion rates
still remain the
most critical
metric for a
publisher’s
focus.
Our research found no significant correlation between the size of a pub-
lisher’s market (measured by print circulation size) and pricing. Other
channels provide an important window into performance, but conversion
Digital Pay-Meter Playbook / August 2019
rates still remain the most critical metric for a publisher’s focus.
While top-performing publishers tended to report higher-volume lists
of email addresses and total newsletter subscribers, the volume of a pub-
lisher’s email list was not necessarily associated with high performance.
In short, across the publishers studied, more emails did not always mean
better outcomes.
The top 5 percent of publishers studied reported email lists of 5 million
The Shorenstein Center on Media, Politics and Public Policy / 19addresses and 1.8 million subscribers, on average, while the median of pub-
lishers studied reported 400,000 addresses and 270,000 subscribers, on av-
erage. Digital subscription strategies are not dependent on the email lists
themselves, but rather how these newsletters and email lists are deployed
and the quality of associated information, materials, and program design.
High performing publishers tended to support email acquisition through
opt-in choice architecture, email segmentation to drive engagement, and
quality content designed to build value. For a deep dive on why list size
does not predict a higher performance, and for more detail on the email
metrics that matter to publishers, please see the Shorenstein Center’s pa-
per Using Data Science Tools for Email Audience Analysis.
Subscriber Engagement and Retention
As publishers grow the top of their funnel, they must ensure they can
convert existing readers and retain subscribers who enter it. Retention
Digital Pay-Meter Playbook / August 2019
requires engagement strategies that cater to the preferences and character-
istics of both subscribers and non-subscribers.
We recommend readers review existing reports from the Shorenstein
Center and co-produced with the Columbia Journalism Review, a Guide to
Audience Revenue and Engagement, and the Shorenstein Center’s Single
Subject News Project.
Improving Subscriber Engagement
The Shorenstein Center on Media, Politics and Public Policy / 20Key finding: Engagement (repeat audience attention) drives business
success.
Subscriber engagement measures the percentage of digital subscribers
who logged in during a given month by the number of active subscriptions
in that month. Research across publishers underscores that engagement
matters – the top decile of publishers studied have engagement rates that
nearly 3 times those of the bottom decile. While monthly digital-only
pricing does not offer a clear guide to subscriber churn, we found a posi-
tive correlation between subscriber engagement and retention among the
publishers studied.21 As a leading indicator of retention, successful news
organizations tend to give subscribers regular reasons to engage and keep
them returning, month after month.
Digital Pay-Meter Playbook / August 2019
The Shorenstein Center on Media, Politics and Public Policy / 21Best Practices for Subscriber Engagement
The best performing publishers studied in the cohort analyzed tended to
leverage content strategy, social media engagement, offline events, video,
email, newsletters, and site optimization to increase engagement among
audiences and subscribers. As a rule of thumb, generally all audience
engagement activity that occurs prior to the subscription should continue
post-subscription. Best practices included:
All audience
engagement
Establishing a Content Strategy Focused on Substance: Across the pub-
activity that lishers studied, content strategies play an important role in engagement as
occurs prior to well as sustaining subscribership. While social virality might appear prom-
the subscrip- ising, the alternative might be the case – articles with fewer social shares
tion should or lower page views might be more popular with subscribers than general
continue post- audiences.
subscription.
Site Recirculation: Site recirculation strategies additionally provide an op-
portunity for publishers to create more engaging relationships with their
reporting, considering how to best drive a particular user to read the next
article. Other approaches might evaluate what might appear in an infinite
scroll following a particular article. Using propensity to subscribe scoring,
a high-performing publisher might, for example, recirculate content based
on the user’s prior section readership, rather than articles relevant to the
previous article.
The Business Case for Local and Unique Content: According the pub-
lishers surveyed, users who view local news appear to be 2-5 times more
likely to subscribe than those who view national and wire-sourced stories.
Of news organizations studied, publishers that produce more local (and
non-wire-sourced) stories tended to generate greater subscription sales.
High-performing editorial and business teams tended to clearly identify
the unique value proposition of local news, incorporating editorial and
coverage to improve readers’ lives within their communities. Critically, our
Digital Pay-Meter Playbook / August 2019
analysis identified a correlation between subscription sales and amount of
local content produced by the publication, reinforcing the business case for
local reporting.
Information as a Service: Similarly to the business case for local content,
publishers studied that provided “information as a service” to subscribers,
including information that helps them live more informed lives, tended to
see greater subscription sales. This category of information includes public
transit and resource coverage and other information that does not require
“reporting”.
The Shorenstein Center on Media, Politics and Public Policy / 22Unique Content: High-performing publishers studied tend to offer a dis-
tinctive value proposition to the reader, incorporating reporting only that
publication can provide. For example, one metro newspaper in a major col-
lege football market studied readership of its football coverage and found
that pageviews in this category largely came from its coverage of the na-
tionally recognized team in its market, an audience for which it competed
heavily with national sports properties like ESPN. The publisher noticed a
smaller school in the area had higher engagement from paying subscribers,
and diverted resources to enhance coverage of the smaller school, driving
subscriber engagement and reporting a greater number of new subscrip-
tion starts.
Building Repeat Audience Attention: Effective publishers tend to help
create “habit of news” among readers; the highest-performing publishers
produce content readers want to refresh and read regularly. Our analysis
found the most engaged subscribers expect daily and often hourly materi-
als, rather than articles that merely resurface and repurpose content from
the news organization’s print edition (if one exists). While wire stories
help a publisher furnish regular content, wires tended to leave an audience
impression of low quality of content. Publishers should prioritize custom-
ized, frequent local coverage that address a community’s particular needs,
concerns, and interests.
Content Scoring and Evaluation: Across high-performing publishers stud-
ied, content elements were seen as sources of data to inform an exchange
of value with the reader. Publishers should score content in the following
areas:
● the percentage of news subscriptions sold in a given time period
when a particular article falls within that user’s conversion path
● the percentage engagement or story viewership by occasional read-
ers, regular readers, and subscribers
● the percentage engagement by these segments by percentage en-
Digital Pay-Meter Playbook / August 2019
gagement across all users
Charting a path to subscription using content scoring might enable a
publisher to see articles that over-perform relative to the norm, and map
patterns that emerge.
Newsletter and Email Signups: A variety of tactics tended to help a pub-
lication increase newsletter and email signups. These materials included
overlays and modals, contests, slide-outs, registration reminders, embed-
The Shorenstein Center on Media, Politics and Public Policy / 23ded modules, and registration walls. Our surveys found publishers addi-
tionally experimented with tools from newsletter providers like Mailchimp
to enable newsletter automation through RSS feeds. High-performing
publishers also tended to leverage email sign-ups for direct subscription
marketing and promotion; direct marketing tends to increase a reader’s
likelihood of subscribing. Email newsletters also play an important role
following the subscription action, increasing engagement and likely re-
tention – and the best performing publishers see newsletters as editorial
products of themselves. High-performing news organizations will track
open rates, click-throughs and propensity describe through newsletters
and optimize to maximize engagement. For more information on email
newsletter best practices, please see the Shorenstein Center and Lenfest
Institute’s Email Newsletter 201 Guide.
Site Optimization: Our analysis found site optimization (especially reduc-
ing website load times) remains a critical challenge for many publishers.
Page load times represent the largest difference between successful pub-
Email newslet- lishers in the top decile and fiftieth percentile of publishers studied, with a
ters also play an median load times of 5.76 seconds.
important role
following the Page load issues can generally challenge publishers, as revenue-generating
subscription ac- activities such as third-party embeddable content marketing engines like
tion, increasing Taboola or Outbrain tend to drain page load efficiency. Publishers might
engagement and evaluate their return on investment on these third party features through
likely reten- benchmarking consumer experience and advertising revenue. Given the
tion – and the high lifetime value of a digital subscriber, a reduction programmatic ad-
best performing vertising revenue might improve conversion or retention. Generally, that
publishers see payoff can be calculated and estimated in advance using CLTV formulas.
newsletters as
editorial prod- Effective site optimizers avoid advertising overload, use real estate to drive
ucts of them- readers to subscription options, and encourage content discovery through
selves. customized recommendations and infinite scrolls – offering seamless read-
ing experiences in desktop and mobile environments.
Digital Pay-Meter Playbook / August 2019
The Shorenstein Center on Media, Politics and Public Policy / 24Load time data, with key national publishers highlighted (median - 5.76s) (Source: Lenfest
Institute for Journalism)
Meter Optimization: Publishers might additionally explore optimizing
how their meters function. Welcome messages offer an important avenue
to capture readers and create email registration leads. Thirty percent of on-
site digital subscriptions originate from “welcome” messages that provide
an introduction to new readers, and ”warn” messages that serve as remind-
ers as the reader approaches the meter limit. Successful publishers test
multiple strategies to determine the most effective marketing messages for
readers. Browser overlays and customized warnings have proven effective,
particularly those that underscore meter limits for individual users and
offer customized options for unique subscriptions based on the reader’s
profile and viewing history.
The most effective stop messages include a single clear call to action, offer
attractive introductory trial rates and include buttons that make clear the
location(s) to click to advance the offer. Others include content-specific
Digital Pay-Meter Playbook / August 2019
messages that link to the specific articles or sections the readers are pur-
suing. Publishers like the New York Times use homepage interstitials to
maximize attention and page resources with marketing and subscription
messages.
Checkout flows are an important and often-ignored step in driving toward
a successful subscriber engagement. Publishers should limit registration
and billing fields, include pre-checked (opt-out) marketing provisions
wherever possible, and make clear the savings from trial rates.
The Shorenstein Center on Media, Politics and Public Policy / 25Marketing and Promotion: Marketing and promotional best practices ap-
peared to also improve publishers’ subscriber acquisition and performance.
Effective marketing messages typically incorporate part or all of the below
messages.
● Campaigns focused on deeper and better content, focusing on
independent journalism, supporting public interest messaging, social
good appeals, or highlighting the impact of a particular news organi-
zation’s journalism
● Campaigns that prioritize convenience and access to content, any-
where and at any time.
● Campaigns that put the user in the driver’s seat – including inform-
Efficient news ing and building intelligence, making the reader a better person.
organizations ● Campaigns that emphasize sampling, including trial rates and in-
tend to consis- troductory offers that compare the cost of entry to a cup of coffee or
tently design another familiar low-cost item.
user experienc-
es and content Publishers that excel in marketing and promotion typically focus house
with an eye advertising, holiday promotions, seasonal offers, and flash promotions
toward what around these efforts, and punctuate these offers with content-specific
action the user promotions (e.g. promoting introductory rates for sports coverage heading
might take next. into a particular season). Other publishers leverage retargeting and aban-
donment marketing tied to an abandoned cart or purchase experience.
High-performing publishers additionally message and optimize effectively
once the user has completed an article or decided to stop reading; a news
organization will ideally present them with the action that is of highest
value, offering a sign-up if the user is not an email subscriber, or present-
ing articles in another section if the user has read three articles in a partic-
ular section. Efficient news organizations tend to consistently design user
experiences and content with an eye toward what action the user might
take next.
Digital Pay-Meter Playbook / August 2019
A Note on Customer Lifetime Value
Customer lifetime value (CLTV) is a critical benchmark for publishers; the
CLTV measures the revenue value of each subscription sold, and is gener-
ated by averaging the average monthly subscription revenue per subscriber
by the monthly churn rate. The variation in a publisher’s monthly churn
rate matters – the higher the customer lifetime value, the more a publisher
can generally spend on marketing and acquisition, according to publish-
The Shorenstein Center on Media, Politics and Public Policy / 26ers evaluated across our studies. The variation can be seen in the range
of CLTV values: the bottom five percent of publishers studied reported a
CLTV of approximately $50, while median publishers have a CLTV of $137,
and the top 5 percent of publishers report a CLTV of $340.
While the benchmarks collected in our study examine each publisher’s
average CLTV, successful publishers studied additionally prioritize under-
standing marginal customer lifetime value – that is, the projected lifetime
value for new subscribers they convert through a particular marketing
channel. This may require more granular analysis of particular subscriber
cohorts, but can illuminate the tradeoff between the cost of acquiring a
new subscriber and the projected revenue generated from that subscriber.
Retention
In addition to evaluating sales performance, the publishers studied priori-
tized retention by evaluating a month’s active customers relative to the pre-
vious month’s active customers. The median publisher sees a 94.4 percent
retention rate, while the top 5 percent of publishers studied reported a 97
percent benchmark.
Retention rate is an important measure for publishers, as subscriber churn
compounds over time and can lead to large changes in revenue with small
drops in retention. Over the average lifetime of a subscription, for example,
a publisher performing at the 90th percentile would, on average generate
36 percent more revenue (measured in terms of average customer lifetime
value) than a publisher performing in the 70th percentile.22 The data show
some association between a publisher’s median subscription price and its
retention rate; publishers studied used site optimization techniques to test
offers that keep subscribers engaged and reduce churn. These same pub-
lishers also tended to capture and optimize the sales activities that would
concurrently drive new subscriptions.
Digital Pay-Meter Playbook / August 2019
The Shorenstein Center on Media, Politics and Public Policy / 27High-performing
publishers tend-
ed to deeply
understand the
source of their
churn – from
the reason for
cancellation to Monthly digital-only pricing by average retention rate for top decile, median
the causes of and bottom decile of publishers (Source: Lenfest Institute for Journalism)
payment lapses.
Improving Retention
Our research found common strategies that might help improve and incen-
tivize retention across a news organization. High-performing publishers
tended to deeply understand the source of their churn – from the reason for
cancellation to the causes of payment lapses.
Continuous touches with audiences ensure publishers carry on a dialogue
with potential payers and existing subscribers. Program regular and dedi-
cated engagement with subscribers through newsletters and social media
– and categorize these efforts not only as new subscriber engagement, as
observed in several newsrooms, but as targeting and tactical opportunities
to engage existing subscribers as well. Prioritizing and sharing highlights,
valued stories relevant to their content histories, and new and novel offer-
ings with a regular cadence will help increase the likelihood a subscriber
perceives the value of their ongoing relationship with your news organiza-
Digital Pay-Meter Playbook / August 2019
tions. These newsletters and other touchpoints should be approached with
the same editorial and content integrity as any other arm of your operation,
written in the voice and tone readers have come to expect. Any strategies
in this vein require investment; these competencies require dedicated re-
sources; the Economist, for example, has a team of 16 focused on retention
alone.23
Publishers use research and operational teams to engage and reach out
to canceled subscribers to determine what went wrong. They then create
The Shorenstein Center on Media, Politics and Public Policy / 28cyclical processes of feedback and evaluation to improve services to over-
come future lapses. A conversation with one reader might represent the
sentiments of many more, and every touchpoint can make a difference.
Good leaders appropriately acknowledge their people and the results
they achieve. Reward the newsroom for content that engages subscribers,
through traffic leaderboards, materials that show comparisons within a
market or area, and by offering accolades to colleagues across the editorial
and business functions.
Several additional strategies can provide critical to building a macro-level
view of lapses and areas in which your news organization’s technology and
offerings can better meet audience expectations:
● Align a collective understanding around the common characteris-
tics of users who cancel, and model a “propensity to churn” score that
can help improve offers or marketing messages to these users.
● Deploy catch-and-save (capture the reader before they have discon-
tinued their subscription with a particular offer), win-back (invita-
tions to come back and re-subscribe for a reduced rate) and surprise
and delight (a surprise pop-up that might appear with a particular
offer) offers for users likely to churn based on your propensity model.
● Solicit subscriber feedback to find and fix product flaws – including
usability issues, long page load times, and confusing user interfaces.
● Determine sources of unintentional churn, such as credit card expi-
ration, and work with subscription providers to adopt best practices,
such as automatic credit card updating and payment delinquency
grace periods.
Digital Pay-Meter Playbook / August 2019
The Shorenstein Center on Media, Politics and Public Policy / 29Conclusion
The above study of large metro and local publishers offers guidance for
how digital subscription models can indeed succeed and begin to thrive in
a competitive news environment. Consumer and reader tastes are chang-
ing, and the growth of digital subscriptions across other sectors has broad-
ly increased readers’ propensity to engage and, ultimately, subscribe.
The publisher models set new standards for engagement in the digital
era. They offer highly appealing, customized information; treat their news
organizations as vital resources to help new and existing readers live better
lives; shape clear and value-capturing offers to convert engaged readers;
and deliver ever-relevant content for existing subscribers to reduce churn.
The highest-performing practitioners in our analysis investigate options
with message testing, and ensure all subscription and retention efforts are
data-driven and continuously optimized. Indeed, they are resourcing these
efforts appropriately to see these results; larger publishers and their small-
er counterparts are increasingly dedicating entire departments to these
endeavors. Given operational constraints, not all publications can pursue
the above audience development and engagement strategies concurrently,
but several simple and low-cost approaches – modeled after best practices
across the industry – might allow publishers to increase engagement, build
a dedicated base of digital subscribers, and begin to reduce a reliance on
advertising revenue.
About
About the Shorenstein Center on Media, Politics and Public Policy
The Shorenstein Center on Media, Politics and Public Policy is a Harvard
University research center dedicated to exploring and illuminating the
intersection of press, politics and public policy in theory and practice. The
Center strives to bridge the gap between journalists and scholars, and be-
tween them and the public.
Digital Pay-Meter Playbook / August 2019
About the Lenfest Institute for Journalism
The Lenfest Institute for Journalism is the first-of-its-kind non-profit orga-
nization whose sole mission is to develop and support sustainable business
models for great local journalism.
The Shorenstein Center on Media, Politics and Public Policy / 30You can also read
